18 W.Va. legislators off to study North Dakota's Legacy Fund

CHARLESTON, W.Va. -- Eighteen West Virginia legislators will travel to North Dakota for three days in late August to learn about that state's legacy fund and how a similar fund could be set up in the Mountain State to take advantage of rising natural gas production.

Senate President Jeff Kessler, who organized the trip, has long advocated using natural gas severance taxes to create a permanent fund that could be used for infrastructure, investment or to provide future tax relief.

Kessler, D-Marshall, said investments in natural gas in his county have quadrupled in the pst three years.

Williams Energy has invested more than $4.5 billion on three facilities in Marshall County alone.

Kessler said the state is going to see gas severance tax collections grow exponentially and that, if that money is not set aside soon, it never will be.

"Should we spend all that in general revenue or set a nest egg aside of several billion dollars to provide for real infrastructure improvements -- roads, highways, broadband, etc.," Kessler said. "You get additional revenues coming in, once it gets dedicated and spent, trying to save it is the last thing people do."

North Dakota's Legacy Fund has collected about $1.3 billion since it was created in 2011. Kessler said a similar fund in West Virginia would be unlikely to grow as quickly because North Dakota's fund is based on oil, as well as gas, and they are further along in developing those resources.

The nine senators and nine delegates -- 15 Democrats and three Republicans -- hope to learn what North Dakota has done to make its fund successful.

"Seeing is always believing," Kessler said. "We can read about it or whatever, but if we can sit and talk to their governor and legislative leaders and the board that administers the fund, it will give us unique insights into how to set up a fund and why it's a desirous course of action for our state."

West Virginia already has two rainy day funds with nearly $1 billion, but Kessler said those funds are for different purposes -- health care and natural disasters -- and not for planning for the future.

"Do we really need more than $1 billion in funds for floods and pestilence?" Kessler said. "I'm talking more of an investment fund for diversifying our economy."

The trip will be from Aug. 21 to 23. At $77 per night, hotel accommodations for the 18-member delegation will be about $3,000. Kessler was not sure about the exact total cost of the trip, but estimated it at about $1,000 per person.

"But at the end of the day, if we come back saving a billion . . . , " Kessler said.